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With market regulator Securities and Exchange Board of India (Sebi) freezing the bank accounts of two Sahara Group firms Sahara India Real Estate Corporation (SIREC) and Sahara Housing Investment Corporation (SHIC) and promoter Subrata Roy in the R24,000-crore optionally fully convertible debenture (OFCD) issue, analysts feel it is the end of the road for the group.

Not only will the group face difficulty in running its day-to-day operations, but it would also not be able to raise money from the market. The immediate casualty could be its plans to open a retail chain, Q-Shop.

With Sebi cracking the whip, industry sources maintain that the group may face rough times at the hands of other regulators examining the manner in which Sahara made overseas acquisitions like the Grosvenor House hotel in London.

The reported findings of a secret intelligence report by the foreign financial intelligence unit, which indicates how the money raised through the OFCDs moved overseas in an unauthorised manner to fund the acquisition. However, the Sahara Group has strongly rebutted these charges.

According to Sandeep Parekh, founder, Finsec Law Advisors, there seems to be no further relief for the group. Sebi's action is based out of a Supreme Court order which says that Sebi is supposed to attach bank accounts, properties, whatever is available. Beyond the Supreme Court there is only god to pray to. The Sebi order has kind of shown the mirror, Parekh told a TV news channel.

According to him, Sahara is left with two alternatives: One, to submit for attachment properties that it has in the Indian subcontinent and two, face contempt of court. As a last resort, Sahara can ask for more time from the Supreme Court.

On top of the the freezing of the bank accounts and attachment of the properties, Sahara also faces a contempt of court charge on which the court gave it four weeks' time on February 6 to explain why action should not be initiated against it.

The Sebi order comes after the hard rap it got from the Supreme Court on February 6 when the apex court asked the market regulator why it was not going ahead with freezing of accounts and attaching the properties as per its August 31, 2012, order.

Legal experts told FE that if Sahara is looking for any relief, it can only get from the SC. In fact, in a late evening statement on Wednesday, the company hinted at the same when it said: ...As regards the instalments to be deposited with Sebi as per the order of the Honble Supreme Court, Sahara has filed interim application before the Honble Supreme Court inter alia praying that Sahara be permitted to furnish security through a credible financial institution instead and in place of the payment of the balance instalments, since Sahara has already redeemed significant number of OFCD holders and any further payments to Sebi would amount to double payment. The said interim application is pending and is likely to come up next week.

In its defence Sahara said: Sebi's order for attachment of the assets is based on old facts and details of assets as of January, 2012. Since then, facts have changed in view of redemptions made by Sahara from time to time. This fact of redemption was known to Sebi. Hence, the order does not take into account the changed facts and circumstances. According to the company, as per the SC's order, the liability to refund the money lies with SIRECL and SHICL. Hence, attachment of assets of individuals by Sebi is incorrect. It said that not only has the company paid Sebi amounts much higher than the outstanding liabilities of the two companies, the fact also remains in the whole affair Sahara is genuinely concerned for investors.